Verbal Agreement

lakeland, fl. in late oct./early nov. i approached a local plastics thermoformer with the idea of forming a plastic shell of a golf putter head and filling said shell with liquid polymer and a proprietary weighting system. (putters were to be fitted with resin domed logo graphics for promotions and/or corp. gifts). having no funding of my own the thermo company agreed (verbally) to enter into a manufacturing relationship with my existing company. thermoformer was to supply parts (ie: shafts, grips, plastic formed shell, resin, etc) to construct 250 units prior to xmas 2001. my company was to conduct assembly and packaging at an agreed amount, plus i was to receive 5% royalty as inventor. i was paid $1937.00 over 4 weeks to construct the putters, yet no parts or supplies were ever ordered or provided (with the exception of 50 inferior plastic shells). i managed to complete 10 units using supplies which i had in stock and delivered them to the thermo co. with a invoice for the materials, which they paid. the original plan was to be in production by late nov. to generate quick local interest at xmas.
as of today i have been given 50 putter shafts and a barrage of phone calls over the past few days demanding i deliver 50 putters or return the shafts and the payment of $1937.00. (today i received a certified letter to that effect.) i do not feel i am obligated in any way as they failed to live up to their original terms and have not provided the agreed upon materials for construction. is the thermoformer in breach of a verbal contract of any kind? (it should be noted that i had sent several sample putters to marketing specialists who dealt with the likes of motorola, coors brewing co., to name a few, but could not commit to a production or delivery schedule due to the thermoformer's lack of fufillment, and quickly lost their interest). any response or advice pro or con would be appreciated.

As I understand your posting, the plastics thermoformer agreed to supply you with parts and you were to construct the units. Since they failed to supply the parts, they are in breach of the contract. An oral contract such as yours is valid. They would be liable to you for any of your lost profits on this.

The problem is that if they deny that there was a contract, you probably can not prove there was—that is one of the main things wrong with oral contracts.